Kentucky Legislature Considers Payday Loan Industry Restrictions

by scrosby on March 20, 2008

From Kentucky Public Radio’s Tony McVeigh 

Legislation moving in the Kentucky General Assembly will place tighter restrictions on payday lenders across the commonwealth. Payday loans is an 800-million dollar a year industry in Kentucky, with stores more than doubling in recent years. The industry, which offers high-interest, short-term loans, has been lightly regulated, but that could soon change under legislation sponsored by Glasgow Rep. Johnny Bell.

During House debate on the bill, Bell pounced on an attempt to send the measure back for more study.

“I’m asking you to step up, vote yes on this bill and let’s protect the consumers, the poor of this commonwealth. That’s who we’re here to protect!” said Bell.

After a sustained standing ovation, the House voted 56-35 to send Bell’s bill to the Senate for further consideration. The bill caps service fees at 13-dollars for each one hundred dollars borrowed and restricts loans to 30-percent of a person’s gross monthly income.

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